3 critical factors affecting economic development in Iraq

The potential of Iraq to become an economic powerhouse in the Middle East is staggering. However, despite possessing an abundant supply of fossil fuels, the country lags behind its supposed contemporaries—especially neighbouring oil exporters Saudi Arabia, Qatar, and the United Arab Emirates.

With oil reserves account for 12% of the collective reserves of the Organization of the Petroleum Exporting Countries, which, on the other hand, account for 81% of the world’s oil reserves, exploiting the full potential of the Iraqi oil industry would mean catapulting the country to newfound economic prosperity.

However, pressing problems are keeping Iraq from achieving its full economic potential. Critical to these problems are social and political instability due to domestic and international hostilities, poor level of education, and marginalisation of women in the Iraqi society.

Incessant sociopolitical instability

Since achieving independence in 1932, sociopolitical volatility typified the modern history of Iraq, thus redirecting its focus away from activities that could have contributed to economic development.

According to The World Fact Book of the Central Intelligence Agency, previous leaders had only brought armed conflicts in the country. The most notable of them was Saddam Hussein who waged a costly and devastating war with Iran from 1980 to 1988, First Persian Gulf War, and subsequently followed it with another high-profile international conflict after annexing Kuwait in 1991,Gulf War.

Hussein remained in power until 2003 when a US-led force invaded Iraq for failure to dispose alleged weapons of mass destructions and long-range missiles, in addition to suspicion of global terrorism support. However, the ouster of the former Iraqi ruler, his subsequent death, and the American pull back in 2011 did not lead to substantial change. Domestic conflict ensued due to prevailing militant activities.

Considering this series of events, it is not hard to imagine why Iraq did not progress the way its counterparts did. Local and international armed conflicts were costly, in addition to the fact that whenever a county pursues armed campaigns, it tends to direct its attention away from economic development.

Short school life expectancy

Years of economic neglect have undermined the quality of education in Iraq. While data from the World Bank reveal an improved access to education, data from CIA, on the other hand, suggest school life expectancy remains within 11 years or less. Thus, despite better access to education, the standard scholastic tenure needed to receive complete or appropriate education remains short.

Education is important in economic development because it serves as a tool for equipping individuals with skills and knowledge needed to become productive members of the society. However, a short school life expectancy wouldn’t suffice.

While countries such as Saudi Arabia and UAE were initially reliant on migrant workers to address workforce shortage and gaps in skills, it is impossible for Iraq to do the same because of its ongoing internal conflicts. Migrant workers and their respective home countries deem Iraq as an unsafe place to work. Top labor exporters including the Philippines have even prohibited their citizens from working in Iraq.

Displaced role of women

The lack of equal rights, especially gender rights is another notable factor affecting Iraq’s economic development. The Heritage Foundation stressed out that immense political and sectarian pressures are downplaying civil liberties and equal rights.

The role of women in economic development is nonetheless critical. In an opinion article that appeared on The Guardian, Dr. Amel Abad Mohammed Ali argued that Iraqi women hold the key to economic prosperity in the country. Simply put, these women are untapped human resource. Equipping them with skills and knowledge and allowing them to be part of the workforce would mean adding value to the economy. Their participation would translate into better collective productivity and promotion of diversity in decision-making. Photo credit: U.S. Army/Flickr/CC